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Youth think housing costs won't rise, but they could ruin their own prophesy

Published: Tuesday, Dec. 18 2012 8:20 p.m. MST

In this 2012 file photo, a home with a room for rent is seen in Palo Alto, Calif. Almost one-third of renters want to buy a house in the next two years, which could trigger more sales as housing prices rise.

Paul Sakuma, AP

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Almost one-third of renters want to buy a house in the next two years, which could trigger more sales as housing prices rise, according to a study by Trulia.

This is in part due to young adults who were not scarred by the housing crisis. Seventy-two percent said homeownership is part of their personal American dream.

In fact, young renters ages 18 to 34 are more optimistic about buying a home than older renters. Ninety-three percent of young renters plan to buy a home someday, and 43 percent of them already own a home.

Percent expected increase and decrease of prices by age group

Perhaps this has to do with the view that youth have with the market. While the majority in all age groups expected rent and housing prices to fall, young adults had a harder time imagining price increases and higher mortgage rates. Only 37 percent expect prices to rise, and only 32 percent expect mortgage rates to increase.

"That means younger adults may be in for a rude awakening when they try to buy," the article said. "Today’s young renters may be overestimating what they’ll be able to afford to buy when their time comes."

EMAIL: alovell@deseretnews.com

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